Skip to main content


Lets’ Start the Conversation - Planning Your Future

  A while ago, I was pulled into a discussion on women’s equality and how to bridge the gap. To me it begins with changing the way we interact in an often evidently patriarchal world. These were my main questions: how many women (working or not) consider the male member of the house as the primary provider? How many women ask the kids to not disturb dad because he has had a long day at work? And how many women leave all the financial decisions of life to their partner to make? In my various discussions, it seems like a lot of women seem to be surprisingly willing to take a back seat in the financial planning. There are various reasons ranging from “its not my area of expertise”, to “its not me who is earning” and some who just “have not got down to it”. Of course, most of these women do think about financial planning but in an environment like Bahrain, avenues and information on options is limited, often individual income of women is limited and, let’s face it, retirement seems to

Behind the Hype – Understanding the Economic Impact of Political Change

I have always believed that the Indian economy functions despite its political environment. Somehow, the entire economic system has learnt to function despite the endemic political chaos, political inertia and high transaction costs related to the above. And when good politics emerge for short spans, we rejoice because the costs have come down for now. I doubt any business in India assumes stability or continuity in a real sense. It’s like a pipe dream. Basically, the economic system in its entirety functions largely in auto-pilot. But there are no shortcuts. The economic system is very complex and even a hundred small things take time to have either an upward or downward cascading impact of any kind. One of the most fundamental and most often used phrases in economics is “ceteris paribus’. But in the real world, this is the most ignored aspect because frankly, nothing really stays constant so viewing one aspect of economic growth or development intrinsically impacts the other.

Big pictures, Small details, – The Nuts And Bolts Of Valuing A New Set Up

When you study accounts, you are taught to pay attention to every tiny detail. Every bit of finished goods needs to be derived from raw materials, work in progress and the reach its current state. Every invoice and value has to tally up. All the small things somehow have a multiplier effect on the balance sheet and errors show up if things are missed. Unlearning this habit when developing a valuation assessment for a set-up, is not an easy process – but a necessary one. I am not saying in any way that misrepresentation is required, simply that generic assumptions, and missing some tiny details when creating a financial model for valuation/investment purposes is perhaps more prudent and quick. Because really, for valuation, the multiplier effects of the smaller things are really minimal. The question to ask when dwelling on a small issue is – is this going to materially impact the value of the company. This is especially true for newer set ups where all the smaller elements are not

An Idea, a Plan, a Spirit: Your Start-Up Ticks Like You Do

Legally, your organization and you are recognized as separate individuals. But beyond legality, the lines are more often than not very blurred. This is especially true for start-ups and the entrepreneurs with big dreams and ideas. How often have you, as an entrepreneur, found yourself funding that one marketing expense out of your own pocket? That land your factory needs can be your own asset - then the money is all with you right? Wrong – in reality, if a business has to be run like a business it has to be separate from you – so if your business owes you something, it owes you – you cannot write it off saying it’s all mine. Again - that’s the legal stand point. Reality: You are one with your business, so embrace the concept in spirit. The idea for the venture usually is a big dream. And a dream has a fundamental premise. You, as the dreamer, have a certain ideology backing up that dream. The details of the implementation plan will include how you want to fundamentally do busi

Investor, Partner or Direction: Choosing the source of funding and the strings that come attached

Equity is often less daunting than debt – we all know that. However, equity often comes with hidden costs and strings that can be tougher to traverse than debt – especially if you do not understand what kind of investor your company actually needs. Broadly speaking, equity funding is usually divided into two broad areas i.e. strategic funding and pure equity funding. The former is fairly self explanatory – it entails a strategic investment which provides either forward or backward linkages to both entities. A strategic investor by definition will look beyond the numbers – he will look at synergies. Often, the strategic investor will see value in processes, customers, markets, employees or technology. A lot of these will be intangible in nature and will be changed as a result of the strategic tie-up. This sort of investor will inherently be involved in the daily functioning and will want a say in how your business is run- a big say.  More often than not, people issues a

Bringing in the Outsider: Are You Ready For Private Equity?

For a long time now, Private Equity (PE) has been seen as the easiest solution to financing needs. At each stage of business growth, funding needs can be met by simply giving an agreeable stake in your business to someone who brings money (and a lot more) to the table. However, like most things, there is nothing simple about the process. The key question that puts the process in perspective is: Are you really ready for an outsider to be a part of what has been just yours – to have them in your meetings, involve them in strategy, and get clearances from them and to use their inputs for fruitful organizational change. The above may sound overwhelming, but remember – a PE investor brings in lot more than just money. PE capital though expensive, is ‘smart money’ and PE firms, despite being typically minority shareholders, meaningfully contribute towards the growth and success of their investee companies. Success of these investments is dependent on the success of the venture/b